AlphaValue Corporate Services
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Keyware

CR
Bloomberg   KEYW BB
Smart Cards-Security  /  Belgium  Web Site   |   Investors Relation
The soft bet is paying off
Target
Upside 112%
Price (€) 1.01
Market Cap (€M) 23.8
Perf. 1W: -0.98%
Perf. 1M: -3.81%
Perf. 3M: -3.81%
Perf Ytd: -7.34%
10 day relative perf. to stoxx600: -3.21%
20 day relative perf. to stoxx600: -0.18%
EPS change17/05/2021

FY21 will continue to be challenging, while we expect mid-term profitability growth

Change in EPS2021 :
2022 :

Our FY19 and FY20 EPS have been pushed down by the integration of the annual results. We have also slightly lowered our FY21 EPS for different reasons: 1) the transition from a hardware provider to a software developer continues to weigh negatively on profitability, 2) the restrictions across Europe will continue to impact Payment Terminals and Payment Authorisations divisions, and 3) the change in the Authorisation’s partner results in a drop in the results in the short term, but should lead to higher margins in the coming years.



Change in Target Price€ 2.07 vs 2.03+1.65%

The company continues to face challenges which weigh on the results, but both the change of acquiring partner and COVID-19-related issues are expected to be beneficial in the mid/long term. Keyware expects the total migration from its previous partner to the new one to take up to the middle of 2021 (depending on new lockdown restrictions), while it is already creating greater value translating into a higher margin. The COVID-19 pandemic has led to growing electronic and contactless payments. Furthermore, with its transition, from hardware provider to fintech specialist, the group should return to profitability growth in mid-term.



Change in DCF€ 2.87 vs 3.09-7.26%

Our DCF has been downgraded due to the deteriorated earnings estimates for FY21 because of the reasons mentioned above.



Updates

03 Oct 22 Earnings/sales releases
A smooth start to the year

18 May 22 Target Change
Integration of the FY21 figures

13 Jan 22 M&A /Corp. Action
Strategic acquisition of Payment Solutions

16 Sep 21 Earnings/sales releases
Back in positive territory thanks to recovery in a...

30 Mar 21 Earnings/sales releases
Change of Authorisations' partner for further pro...

16 Sep 20 Earnings/sales releases
A pivotal year for the Authorisations division

26 May 20 Earnings/sales releases
The right time to establish itself as a software pr...

18 Mar 20 Earnings/sales releases
Positioned to take advantage of increasing pow...

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